Collateralised vs. Unguaranteed Loans: Understanding the Difference
When seeking a loan, one of the most crucial factors is whether it's secured or unsecured. A secured loan requires collateral, which is an asset the lender can seize if you default on the debt. This collateral acts as protection for the lender, transforming secured loans less dangerous. Conversely, an collateral-free loan forgoes this requirement.